Designation of Low-Income Status; Acceptance of Secondary Capital Accounts by Low-Income Designated Credit Unions, 4030-4032 [2013-00859]

Download as PDF 4030 Federal Register / Vol. 78, No. 13 / Friday, January 18, 2013 / Rules and Regulations conform the regulation to changes made to NCUA’s standard maximum share insurance amount (SMSIA) by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). Specifically, the Dodd-Frank Act increased the SMSIA from $100,000 to $250,000. The final rule is effective on January 18, 2013. DATES: FOR FURTHER INFORMATION CONTACT: John H. Brolin, Staff Attorney, or Frank Kressman, Associate General Counsel, Office of General Counsel, at 1775 Duke Street, Alexandria, VA 22314 or telephone: (703) 518–6438. SUPPLEMENTARY INFORMATION: I. Background and Purpose of the Final Rule II. Regulatory Procedures I. Background and Purpose of the Final Rule Why is the NCUA Board issuing this rule? Section 335 of the Dodd-Frank Act 1 amended the Federal Credit Union Act to make permanent an increase in the SMSIA to $250,000. In September 2010, the Board issued a final rule 2 which amended the SMSIA in NCUA’s part 745 share insurance regulations to conform the regulatory language to the Dodd-Frank Act statutory change. The Board is now amending § 701.37(c), which still reflects the former $100,000 SMSIA, to update it to reflect the current $250,000 SMSIA. II. Regulatory Procedures emcdonald on DSK67QTVN1PROD with Final Rule Generally, the Administrative Procedure Act (APA) requires a federal agency to provide the public with notice and the opportunity to comment on agency rulemakings. The amendments in this rule are non-substantive and technical. They make minor changes which are statutorily required by the Dodd-Frank Act. The APA permits an agency to forego the notice and comment period under certain circumstances, such as when a rulemaking is technical and nonsubstantive. NCUA finds that, in this instance, notice and public comment are unnecessary under section 553(b)(3)(B) of the APA.3 NCUA also finds good cause to dispense with the 30-day delayed effective date requirement under section 553(d)(3) of the APA.4 1 Public Law 111–203; 124 Stat. 1376, 1540 (July 21, 2010). 2 75 FR 53841 (Sept. 2, 2010). 3 5 U.S.C. 553(b)(3)(B). 4 5 U.S.C. 553(d)(3). VerDate Mar<15>2010 14:08 Jan 17, 2013 Jkt 229001 The rule, therefore, will be effective immediately upon publication. Regulatory Flexibility Act The Regulatory Flexibility Act requires NCUA to prepare an analysis to describe any significant economic impact a rule may have on a substantial number of small entities (primarily those under $10 million in assets). NCUA has determined these technical amendments will not have a significant economic impact on a substantial number of small credit unions. Paperwork Reduction Act The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in which an agency by rule creates a new paperwork burden on regulated entities or modifies an existing burden.5 For purposes of the PRA, a paperwork burden may take the form of either a reporting or a recordkeeping requirement, both referred to as information collections. NCUA has determined that the technical amendments in this final rule do not increase the paperwork requirements under PRA or regulations of the Office of Management and Budget. Executive Order 13132 Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order to adhere to fundamental federalism principles. This final rule will not have a substantial direct effect on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. NCUA has determined that this final rule does not constitute a policy that has federalism implications for purposes of the executive order. Assessment of Federal Regulations and Policies on Families NCUA has determined that this final rule will not affect family well-being within the meaning of Section 654 of the Treasury and General Government Appropriations Act, 1999.6 Small Business Regulatory Enforcement Fairness Act The Small Business Regulatory Enforcement Fairness Act of 1996 7 (SBREFA) provides generally for 5 44 U.S.C. 3507(d); 5 CFR part 1320. Law 105–277, 112 Stat. 2681 (1998). 7 Public Law 104–121, 110 Stat. 857 (1996). congressional review of agency rules. A reporting requirement is triggered in instances where NCUA issues a final rule as defined by Section 551 of the Administrative Procedure Act.8 NCUA has submitted this rule to the Office of Management and Budget for it to determine if the final rule is a ‘‘major rule’’ for purposes of SBREFA. NCUA does not believe the rule is major. List of Subjects in 12 CFR Part 701 Credit unions; Share insurance. By the National Credit Union Administration Board on January 10, 2013. Mary Rupp, Secretary of the Board. For the reasons discussed above, the NCUA Board amends 12 CFR part 701 as follows: PART 701—ORGANIZATION AND OPERATION OF FEDERAL CREDIT UNIONS 1. The authority citation for part 701 continues to read as follows: ■ Authority: 12 U.S.C. 1752(5), 1755, 1756, 1757, 1758, 1759, 1761a, 1761b, 1766, 1767, 1782, 1784, 1786, 1787, 1789. Section 701.6 is also authorized by 15 U.S.C. 3717. Section 701.31 is also authorized by 15 U.S.C. 1601 et seq.; 42 U.S.C. 1981 and 3601–3610. Section 701.35 is also authorized by 42 U.S.C. 4311–4312. § 701.37 [Amended] 2. Amend § 701.37(c) by removing the term ‘‘$100,000’’ wherever it appears and adding in its place the term ‘‘$250,000’’. ■ [FR Doc. 2013–00861 Filed 1–17–13; 8:45 am] BILLING CODE 7535–01–P NATIONAL CREDIT UNION ADMINISTRATION 12 CFR Parts 701 and 741 RIN 3133–AE09 Designation of Low-Income Status; Acceptance of Secondary Capital Accounts by Low-Income Designated Credit Unions National Credit Union Administration (NCUA). ACTION: Final rule. AGENCY: The NCUA Board (Board) is amending its low-income credit unions regulation by extending the time period in which a federal credit union (FCU) may accept a low-income designation. Under the current rule, an FCU that receives notice from NCUA of its SUMMARY: 6 Public PO 00000 Frm 00016 Fmt 4700 Sfmt 4700 85 U.S.C. 551. E:\FR\FM\18JAR1.SGM 18JAR1 Federal Register / Vol. 78, No. 13 / Friday, January 18, 2013 / Rules and Regulations eligibility for a low-income designation has 30 days to notify NCUA in writing that it wishes to accept the designation. The final rule extends an FCU’s response time from 30 days to 90 days to make certain an FCU has adequate time to respond. The final rule also makes minor, nonsubstantive technical amendments to NCUA’s requirements for insurance regulation to reflect current agency practice. DATES: This rule is effective February 19, 2013. FOR FURTHER INFORMATION CONTACT: Frank Kressman, Associate General Counsel, or Pamela Yu, Staff Attorney, Office of General Counsel, National Credit Union Administration, 1775 Duke Street, Alexandria, Virginia 22314–3428 or telephone (703) 518– 6593. SUPPLEMENTARY INFORMATION: I. Background and Proposal II. Final Rule III. Regulatory Procedures I. Background and Proposal A. What is a low-income credit union? An FCU qualifies as a low-income credit union (LICU) under NCUA’s regulations if a majority of its membership consists of ‘‘low-income members,’’ as defined by the Board.1 Currently, the Board defines ‘‘lowincome members’’ as those members whose family income is 80% or less than the total median earnings for individuals for the metropolitan area where they live or national metropolitan area, whichever is greater.2 B. What are the benefits of being designated a LICU? emcdonald on DSK67QTVN1PROD with The Federal Credit Union Act provides LICUs with statutory relief and other benefits.3 Examples of such relief and benefits include: • Exemption from the statutory cap on member business loans; • Authorization to accept nonmember deposits from any source; • Authorization to accept secondary capital; and • Eligibility for assistance from the Community Development Revolving Loan Fund. 1 12 CFR 701.34. A state-chartered credit union may obtain a LICU designation from its state supervisory authority with concurrence from NCUA. Benefits of the state LICU designation vary by state, based on applicable state law. 2 For members living outside a metropolitan area, NCUA will use the statewide or national, nonmetropolitan area median family income instead of the metropolitan area or national metropolitan area median family income. 12 CFR 701.34(a)(2). 3 12 U.S.C. 1752(5), 1757a(b)(2)(A), 1757a(c)(2)(B), 1772c–1. VerDate Mar<15>2010 14:08 Jan 17, 2013 Jkt 229001 All of these benefits help a LICU better serve its members and community. C. October 2012 Proposal Executive Order 13579 provides that independent agencies, including NCUA, should consider if they can modify, streamline, expand, or repeal existing regulations to make their programs more effective and less burdensome.4 Additionally, the Board has a policy of continually reviewing its regulations to ‘‘update, clarify and simplify existing regulations and eliminate redundant and unnecessary provisions.’’ 5 To carry out this internal policy, NCUA identifies one-third of its existing regulations for review each year and provides notice of this review so the public may comment. NCUA reviewed the LICU rule as part of this process. In October 2012, the Board proposed amendments to the LICU rule.6 The Board was aware that some FCUs believed the LICU designation process was too burdensome in some cases. In particular, FCUs have stated that the requirement that an FCU accept the LICU designation within 30 days of having received notice of its eligibility from NCUA is too short for some FCUs. For example, they noted that it may take an FCU longer than 30 days to fully analyze if it wishes to accept the LICU designation or to obtain approval from its board of directors. Accordingly, the October 2012 proposal extended the acceptance time period from 30 days to 90 days. The Board believes that extending the timeframe to 90 days will make it easier for an eligible FCU to accept the LICU designation, take advantage of the benefits afforded to LICUs, and better serve its members and community. Overall, the proposal provided regulatory relief to FCUs and improved the LICU designation process. Additionally, the proposal made several minor, nonsubstantive revisions to NCUA’s requirements for insurance regulation. These technical corrections are necessary to reflect current agency practice. II. Final Rule A. Summary of Comments on the October 2012 Proposal NCUA received 5 comments on the October 2012 proposal. The comments were universally positive, and all commenters supported extending the acceptance time period to 90 days. 4 E.O. 13579 (July 11, 2011). Interpretive Ruling and Policy Statement (IRPS) 87–2, as amended by IRPS 03–2, Developing and Reviewing Government Regulations. 6 77 FR 65139 (Oct. 25, 2012). 5 NCUA PO 00000 Frm 00017 Fmt 4700 Sfmt 4700 4031 Several commenters also noted the extended time period will allow an FCU sufficient time to determine if the designation fits with its strategic plans. In addition, four commenters urged NCUA to further clarify the process for designating state-chartered, low-income credit unions as LICUs and to work with state regulators to ensure the state designation process is comparable to the federal process. The Board agrees that working with state regulators in this regard is worthwhile and would benefit state-chartered credit unions and their members. B. Why is the Board adopting this rule? The Board is adopting the October 2012 proposed rule as a final rule without change for the same reasons it issued the October 2012 proposed rule. In short, the final rule provides FCUs with regulatory relief and improves the LICU designation process by giving eligible FCUs sufficient time to: (1) Evaluate the benefits of having the designation; (2) determine if having the designation is consistent with their strategic plans; and (3) obtain FCU board of directors’ approval. The final rule also enables more eligible FCUs to accept the LICU designation to better serve their members and communities. The proposed and final rules are fully supported by those who commented. The Board is also adopting minor, nonsubstantive technical corrections to NCUA’s requirements for insurance regulation to update and conform it to current agency practice. Previously, regional directors had the delegated authority to designate FCUs as LICUs. Currently, NCUA’s Office of Consumer Protection has that delegated authority. This final rule updates and amends § 741.204 to remove references to regional directors.7 The Board reiterates that NCUA plans to notify FCUs of their eligibility on a periodic basis. An FCU that does not or is not able to respond to a particular NCUA notification in a timely manner will have additional opportunities to accept the designation in the future. Additionally, an FCU may relinquish its LICU status at any time, for any reason, simply by notifying NCUA in writing that it wishes to do so. While the Board believes the LICU designation is advantageous to eligible FCUs, it notes that it is just as easy to relinquish the designation as it is to accept it. An FCU that accepts the designation only needs to accept it once, after which NCUA will not send additional notifications. 7 12 E:\FR\FM\18JAR1.SGM CFR 741.204. 18JAR1 4032 Federal Register / Vol. 78, No. 13 / Friday, January 18, 2013 / Rules and Regulations C. Does the final rule create any new burdens for credit unions? No, neither the October 2012 proposal nor this final rule creates any new regulatory burdens for FCUs. To the contrary, as mentioned above, the Board is providing regulatory relief to FCUs that qualify for the LICU designation. III. Regulatory Procedures A. Regulatory Flexibility Act The Regulatory Flexibility Act requires NCUA to prepare an analysis to describe any significant economic impact a rule may have on a substantial number of small entities (primarily those under ten million dollars in assets). This final rule makes nonsubstantive, technical amendments and extends regulatory relief to FCUs. NCUA has determined and certifies that this final rule will not have a significant economic impact on a substantial number of small credit unions. B. Paperwork Reduction Act The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in which an agency by rule creates a new paperwork burden on regulated entities or modifies an existing burden.8 For purposes of the PRA, a paperwork burden may take the form of either a reporting or a recordkeeping requirement, both referred to as information collections. As noted above, the amendments make minor, technical corrections and extend regulatory relief. The final rule does not impose or modify paperwork burdens. emcdonald on DSK67QTVN1PROD with C. Executive Order 13132 Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order to adhere to fundamental federalism principles. This final rule will not have a substantial direct effect on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. NCUA has determined that this final rule does not constitute a policy that has federalism implications for purposes of the executive order. D. Assessment of Federal Regulations and Policies on Families NCUA has determined that this final rule will not affect family well-being within the meaning of Section 654 of the Treasury and General Government Appropriations Act, 1999.9 NCUA in writing within 90 days of receipt of any NCUA notifications. * * * * * E. Small Business Regulatory Enforcement Fairness Act PART 741—REQUIREMENTS FOR INSURANCE The Small Business Regulatory Enforcement Fairness Act of 1996 10 (SBREFA) provides generally for congressional review of agency rules. A reporting requirement is triggered in instances where NCUA issues a final rule as defined by Section 551 of the Administrative Procedure Act.11 NCUA does not believe this final rule is a ‘‘major rule’’ within the meaning of the relevant sections of SBREFA. NCUA has submitted the rule to the Office of Management and Budget for its determination in that regard. U.S.C. 3507(d); 5 CFR part 1320. VerDate Mar<15>2010 14:08 Jan 17, 2013 Jkt 229001 Authority: 12 U.S.C. 1757, 1766(a), 1781– 1790, and 1790d; 31 U.S.C. 3717. § 741.204 [Amended] Credit, Credit unions, Reporting and recordkeeping requirements. 4. Amend § 741.204 by: a. Removing the words ‘‘the appropriate regional director’’ in paragraph (b) and adding in their place the word ‘‘NCUA’’. ■ b. Removing the words ‘‘the NCUA Regional Director’’ wherever they appear and adding in their place the word ‘‘NCUA’’. ■ c. Removing the words ‘‘the appropriate NCUA Regional Director’’ wherever they appear and adding in their place the word ‘‘NCUA’’. 12 CFR Part 741 [FR Doc. 2013–00859 Filed 1–17–13; 8:45 am] Credit, Credit unions, Reporting and recordkeeping requirements, Share insurance. BILLING CODE 7535–01–P List of Subjects 12 CFR Part 701 By the National Credit Union Administration Board on January 10, 2013. Mary F. Rupp, Secretary of the Board. For the reasons stated in the preamble, the National Credit Union Administration amends 12 CFR parts 701 and 741 as set forth below: ■ ■ NATIONAL CREDIT UNION ADMINISTRATION 12 CFR Parts 702, 741 and 791 RIN 3133–AE07 Prompt Corrective Action, Requirements for Insurance, and Promulgation of NCUA Rules and Regulations PART 701—ORGANIZATION AND OPERATIONS OF FEDERAL CREDIT UNIONS AGENCY: 1. The authority citation for part 701 continues to read as follows: SUMMARY: ■ Authority: 12 U.S.C. 1752(5), 1757, 1765, 1766, 1781, 1782, 1787, 1789; Title V, Pub. L. 109–351, 120 Stat. 1966. 2. Revise § 701.34(a)(1) to read as follows: ■ § 701.34 Designation of low-income status; Acceptance of secondary capital accounts by low-income designated credit unions. (a) Designation of low-income status. (1) Based on data obtained through examinations, NCUA will notify a federal credit union that it qualifies for designation as a low-income credit union if a majority of its membership qualifies as low-income members. A federal credit union that wishes to receive the designation must notify 9 Public Law 105–277, 112 Stat. 2681 (1998). Law 104–121, 110 Stat. 857 (1996). 11 5 U.S.C. 551. 10 Public 8 44 3. The authority citation for part 741 continues to read as follows: ■ PO 00000 Frm 00018 Fmt 4700 Sfmt 4700 National Credit Union Administration (NCUA). ACTION: Final rule. The NCUA Board (Board) is issuing a final rule to amend Interpretive Ruling and Policy Statement (IRPS) 87–2, as amended by IRPS 03–2, and two NCUA regulations that apply asset thresholds to grant relief from risk-based net worth and interest rate risk requirements. The amended IRPS increases the asset threshold that identifies credit unions to which NCUA will give more robust consideration of regulatory relief in future rulemakings. The amended regulations similarly include increased asset thresholds, granting immediate and prospective relief from existing regulatory burden to a larger group of small credit unions. DATES: This rule is effective February 19, 2013. FOR FURTHER INFORMATION CONTACT: Kevin Tuininga, Trial Attorney, Office of General Counsel, National Credit Union Administration, 1775 Duke E:\FR\FM\18JAR1.SGM 18JAR1

Agencies

National Credit Union Administration

[Federal Register Volume 78, Number 13 (Friday, January 18, 2013)]
[Rules and Regulations]
[Pages 4030-4032]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-00859]


-----------------------------------------------------------------------

NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Parts 701 and 741

RIN 3133-AE09


Designation of Low-Income Status; Acceptance of Secondary Capital 
Accounts by Low-Income Designated Credit Unions

AGENCY: National Credit Union Administration (NCUA).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The NCUA Board (Board) is amending its low-income credit 
unions regulation by extending the time period in which a federal 
credit union (FCU) may accept a low-income designation. Under the 
current rule, an FCU that receives notice from NCUA of its

[[Page 4031]]

eligibility for a low-income designation has 30 days to notify NCUA in 
writing that it wishes to accept the designation. The final rule 
extends an FCU's response time from 30 days to 90 days to make certain 
an FCU has adequate time to respond. The final rule also makes minor, 
nonsubstantive technical amendments to NCUA's requirements for 
insurance regulation to reflect current agency practice.

DATES: This rule is effective February 19, 2013.

FOR FURTHER INFORMATION CONTACT: Frank Kressman, Associate General 
Counsel, or Pamela Yu, Staff Attorney, Office of General Counsel, 
National Credit Union Administration, 1775 Duke Street, Alexandria, 
Virginia 22314-3428 or telephone (703) 518-6593.

SUPPLEMENTARY INFORMATION:

I. Background and Proposal
II. Final Rule
III. Regulatory Procedures

I. Background and Proposal

A. What is a low-income credit union?

    An FCU qualifies as a low-income credit union (LICU) under NCUA's 
regulations if a majority of its membership consists of ``low-income 
members,'' as defined by the Board.\1\ Currently, the Board defines 
``low-income members'' as those members whose family income is 80% or 
less than the total median earnings for individuals for the 
metropolitan area where they live or national metropolitan area, 
whichever is greater.\2\
---------------------------------------------------------------------------

    \1\ 12 CFR 701.34. A state-chartered credit union may obtain a 
LICU designation from its state supervisory authority with 
concurrence from NCUA. Benefits of the state LICU designation vary 
by state, based on applicable state law.
    \2\ For members living outside a metropolitan area, NCUA will 
use the statewide or national, non-metropolitan area median family 
income instead of the metropolitan area or national metropolitan 
area median family income. 12 CFR 701.34(a)(2).
---------------------------------------------------------------------------

B. What are the benefits of being designated a LICU?

    The Federal Credit Union Act provides LICUs with statutory relief 
and other benefits.\3\ Examples of such relief and benefits include:
---------------------------------------------------------------------------

    \3\ 12 U.S.C. 1752(5), 1757a(b)(2)(A), 1757a(c)(2)(B), 1772c-1.
---------------------------------------------------------------------------

     Exemption from the statutory cap on member business loans;
     Authorization to accept non-member deposits from any 
source;
     Authorization to accept secondary capital; and
     Eligibility for assistance from the Community Development 
Revolving Loan Fund.
    All of these benefits help a LICU better serve its members and 
community.

C. October 2012 Proposal

    Executive Order 13579 provides that independent agencies, including 
NCUA, should consider if they can modify, streamline, expand, or repeal 
existing regulations to make their programs more effective and less 
burdensome.\4\ Additionally, the Board has a policy of continually 
reviewing its regulations to ``update, clarify and simplify existing 
regulations and eliminate redundant and unnecessary provisions.'' \5\ 
To carry out this internal policy, NCUA identifies one-third of its 
existing regulations for review each year and provides notice of this 
review so the public may comment. NCUA reviewed the LICU rule as part 
of this process.
---------------------------------------------------------------------------

    \4\ E.O. 13579 (July 11, 2011).
    \5\ NCUA Interpretive Ruling and Policy Statement (IRPS) 87-2, 
as amended by IRPS 03-2, Developing and Reviewing Government 
Regulations.
---------------------------------------------------------------------------

    In October 2012, the Board proposed amendments to the LICU rule.\6\ 
The Board was aware that some FCUs believed the LICU designation 
process was too burdensome in some cases. In particular, FCUs have 
stated that the requirement that an FCU accept the LICU designation 
within 30 days of having received notice of its eligibility from NCUA 
is too short for some FCUs. For example, they noted that it may take an 
FCU longer than 30 days to fully analyze if it wishes to accept the 
LICU designation or to obtain approval from its board of directors. 
Accordingly, the October 2012 proposal extended the acceptance time 
period from 30 days to 90 days. The Board believes that extending the 
timeframe to 90 days will make it easier for an eligible FCU to accept 
the LICU designation, take advantage of the benefits afforded to LICUs, 
and better serve its members and community. Overall, the proposal 
provided regulatory relief to FCUs and improved the LICU designation 
process.
---------------------------------------------------------------------------

    \6\ 77 FR 65139 (Oct. 25, 2012).
---------------------------------------------------------------------------

    Additionally, the proposal made several minor, nonsubstantive 
revisions to NCUA's requirements for insurance regulation. These 
technical corrections are necessary to reflect current agency practice.

II. Final Rule

A. Summary of Comments on the October 2012 Proposal

    NCUA received 5 comments on the October 2012 proposal. The comments 
were universally positive, and all commenters supported extending the 
acceptance time period to 90 days. Several commenters also noted the 
extended time period will allow an FCU sufficient time to determine if 
the designation fits with its strategic plans.
    In addition, four commenters urged NCUA to further clarify the 
process for designating state-chartered, low-income credit unions as 
LICUs and to work with state regulators to ensure the state designation 
process is comparable to the federal process. The Board agrees that 
working with state regulators in this regard is worthwhile and would 
benefit state-chartered credit unions and their members.

B. Why is the Board adopting this rule?

    The Board is adopting the October 2012 proposed rule as a final 
rule without change for the same reasons it issued the October 2012 
proposed rule. In short, the final rule provides FCUs with regulatory 
relief and improves the LICU designation process by giving eligible 
FCUs sufficient time to: (1) Evaluate the benefits of having the 
designation; (2) determine if having the designation is consistent with 
their strategic plans; and (3) obtain FCU board of directors' approval. 
The final rule also enables more eligible FCUs to accept the LICU 
designation to better serve their members and communities. The proposed 
and final rules are fully supported by those who commented.
    The Board is also adopting minor, nonsubstantive technical 
corrections to NCUA's requirements for insurance regulation to update 
and conform it to current agency practice. Previously, regional 
directors had the delegated authority to designate FCUs as LICUs. 
Currently, NCUA's Office of Consumer Protection has that delegated 
authority. This final rule updates and amends Sec.  741.204 to remove 
references to regional directors.\7\
---------------------------------------------------------------------------

    \7\ 12 CFR 741.204.
---------------------------------------------------------------------------

    The Board reiterates that NCUA plans to notify FCUs of their 
eligibility on a periodic basis. An FCU that does not or is not able to 
respond to a particular NCUA notification in a timely manner will have 
additional opportunities to accept the designation in the future. 
Additionally, an FCU may relinquish its LICU status at any time, for 
any reason, simply by notifying NCUA in writing that it wishes to do 
so. While the Board believes the LICU designation is advantageous to 
eligible FCUs, it notes that it is just as easy to relinquish the 
designation as it is to accept it. An FCU that accepts the designation 
only needs to accept it once, after which NCUA will not send additional 
notifications.

[[Page 4032]]

C. Does the final rule create any new burdens for credit unions?

    No, neither the October 2012 proposal nor this final rule creates 
any new regulatory burdens for FCUs. To the contrary, as mentioned 
above, the Board is providing regulatory relief to FCUs that qualify 
for the LICU designation.

III. Regulatory Procedures

A. Regulatory Flexibility Act

    The Regulatory Flexibility Act requires NCUA to prepare an analysis 
to describe any significant economic impact a rule may have on a 
substantial number of small entities (primarily those under ten million 
dollars in assets). This final rule makes nonsubstantive, technical 
amendments and extends regulatory relief to FCUs. NCUA has determined 
and certifies that this final rule will not have a significant economic 
impact on a substantial number of small credit unions.

B. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in 
which an agency by rule creates a new paperwork burden on regulated 
entities or modifies an existing burden.\8\ For purposes of the PRA, a 
paperwork burden may take the form of either a reporting or a 
recordkeeping requirement, both referred to as information collections. 
As noted above, the amendments make minor, technical corrections and 
extend regulatory relief. The final rule does not impose or modify 
paperwork burdens.
---------------------------------------------------------------------------

    \8\ 44 U.S.C. 3507(d); 5 CFR part 1320.
---------------------------------------------------------------------------

C. Executive Order 13132

    Executive Order 13132 encourages independent regulatory agencies to 
consider the impact of their actions on state and local interests. 
NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), 
voluntarily complies with the executive order to adhere to fundamental 
federalism principles. This final rule will not have a substantial 
direct effect on the states, on the relationship between the national 
government and the states, or on the distribution of power and 
responsibilities among the various levels of government. NCUA has 
determined that this final rule does not constitute a policy that has 
federalism implications for purposes of the executive order.

D. Assessment of Federal Regulations and Policies on Families

    NCUA has determined that this final rule will not affect family 
well-being within the meaning of Section 654 of the Treasury and 
General Government Appropriations Act, 1999.\9\
---------------------------------------------------------------------------

    \9\ Public Law 105-277, 112 Stat. 2681 (1998).
---------------------------------------------------------------------------

 E. Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act of 1996 \10\ 
(SBREFA) provides generally for congressional review of agency rules. A 
reporting requirement is triggered in instances where NCUA issues a 
final rule as defined by Section 551 of the Administrative Procedure 
Act.\11\ NCUA does not believe this final rule is a ``major rule'' 
within the meaning of the relevant sections of SBREFA. NCUA has 
submitted the rule to the Office of Management and Budget for its 
determination in that regard.
---------------------------------------------------------------------------

    \10\ Public Law 104-121, 110 Stat. 857 (1996).
    \11\ 5 U.S.C. 551.
---------------------------------------------------------------------------

List of Subjects

12 CFR Part 701

    Credit, Credit unions, Reporting and recordkeeping requirements.

12 CFR Part 741

    Credit, Credit unions, Reporting and recordkeeping requirements, 
Share insurance.

    By the National Credit Union Administration Board on January 10, 
2013.
Mary F. Rupp,
Secretary of the Board.

    For the reasons stated in the preamble, the National Credit Union 
Administration amends 12 CFR parts 701 and 741 as set forth below:

PART 701--ORGANIZATION AND OPERATIONS OF FEDERAL CREDIT UNIONS

0
1. The authority citation for part 701 continues to read as follows:

    Authority: 12 U.S.C. 1752(5), 1757, 1765, 1766, 1781, 1782, 
1787, 1789; Title V, Pub. L. 109-351, 120 Stat. 1966.

0
2. Revise Sec.  701.34(a)(1) to read as follows:


Sec.  701.34  Designation of low-income status; Acceptance of secondary 
capital accounts by low-income designated credit unions.

    (a) Designation of low-income status. (1) Based on data obtained 
through examinations, NCUA will notify a federal credit union that it 
qualifies for designation as a low-income credit union if a majority of 
its membership qualifies as low-income members. A federal credit union 
that wishes to receive the designation must notify NCUA in writing 
within 90 days of receipt of any NCUA notifications.
* * * * *

PART 741--REQUIREMENTS FOR INSURANCE

0
3. The authority citation for part 741 continues to read as follows:

    Authority: 12 U.S.C. 1757, 1766(a), 1781-1790, and 1790d; 31 
U.S.C. 3717.


Sec.  741.204  [Amended]

0
4. Amend Sec.  741.204 by:
0
a. Removing the words ``the appropriate regional director'' in 
paragraph (b) and adding in their place the word ``NCUA''.
0
b. Removing the words ``the NCUA Regional Director'' wherever they 
appear and adding in their place the word ``NCUA''.
0
c. Removing the words ``the appropriate NCUA Regional Director'' 
wherever they appear and adding in their place the word ``NCUA''.

[FR Doc. 2013-00859 Filed 1-17-13; 8:45 am]
BILLING CODE 7535-01-P

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